Chinese outbound tourists’ spending habits are evolving alongside their tastes

The rise of Chinese outbound tourism has been characterised by the image of free-spending Chinese consumers, known the world over for buying up luxury goods in major shopping cities such as Paris, Seoul, Dubai and San Francisco. With the Chinese being the world’s highest-spending travellers by nationality – comfortably more than the second and third-placed Americans and Germans combined – they have become the most important international market segment for many major luxury brands.

Nevertheless, as the market continues to mature and diversify, so too have the overseas spending habits of Chinese tourists themselves. The past two to three years has seen a widespread change in attitude towards shopping among the Chinese, with many outbound tourists no longer regarding it as the primary purpose of overseas travel.

While stocking up overseas on designer brand goods and spending lavishly on souvenirs for friends and relatives was previously regarded by many Chinese as a means of cultivating bragging rights among their social circle at home, for more experienced FITs and modular Chinese tourists the social value of such consumption has diminished as international travel has become increasingly commonplace.

Instead of acquiring famous designer labels as a means of gaining prestige, affluent Chinese travellers are increasingly looking to signify refined taste and higher levels of personal involvement by acquiring more lifestyle-oriented ‘boutique’-branded brands and more unique locally-produced goods, or otherwise spending higher proportions of their travel budget on activities and experiences such as summer and winter sports, fine dining or learning experiences.

On top of the shifting purchasing preferences of Chinese outbound tourists themselves, the latest instalment of the China Outbound Travel series also draws attention to a number of external factors that have helped to influence the change in consumption patterns. For example, crackdowns on ‘zero-dollar’ tours, renowned for forced shopping activities, has led to tour operators promote products with voluntary shopping opportunities or more experience-based activities. Furthermore, government policies in recent years have sought to curb excessive gift-giving and hedonistic spending levels, while Chinese sales taxes on numerous items have been lowered, thereby reducing the incentive to take advantage of lower prices overseas.

While patterns are changing, Chinese international travellers’ position as the global tourism market’s high-spending group by nationality is not likely to be challenged in the near future. However, as outbound consumers continue to become more discerning in their spending habits, the stereotype of overseas Chinese travellers as ‘explosive’ consumers of designer goods will be somewhat challenged.

In its conclusion, the most recent China Outbound Travel Pulse episode underlines that, as the market continues to develop, increasingly-experienced Chinese travellers will be drawn to products that are “unique, locally-made and tell a good ‘story’”, while highlighting the importance of discounts, KOL endorsements and Chinese-speaking staff for overseas retailers.

The ‘Shopping’ episode of the China Outbound Travel Pulse video series is available here.

For more information regarding the series and access to previous episodes, please see the China Outbound Travel Pulse section of the COTRI website.

Image: Screenshot, Shopping – China Outbound Travel Pulse – Episode 3, Dragon Trail Interactive & COTRI Chinese Outbound Tourism Research Institute

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